In the matter of 77738930144 Pty Limited (in liq) (formerly Commercial Indemnity Pty Ltd) [2017] NSWSC 452

Supreme Court New South Wales

Medium Neutral Citation: In the matter of 77738930144 Pty Limited (in liq) (formerly Commercial Indemnity Pty Ltd) [2017] NSWSC 452 Hearing dates: 20 and 29 March 2017 Decision date: 21 April 2017 Before: Gleeson JA Decision: (1) Order, pursuant to ss 7 and 8(1)(a) of the Courts Suppression and Non-Publication Orders Act 2010 (NSW), that: (i) disclosure of annexure "A" to the confidential affidavit of Geoffrey Newling sworn 14 March 2017, annexures "A" and "B" to the affidavit of Geoffrey Trent Hancock sworn 24 March 2017 and confidential exhibit 2 be prohibited except by order of the Court made on application of which the plaintiff has been given at least three business days' notice; (ii) that the documents referred to in (i) above be retained in the Court file in an envelope marked "Confidential: to be opened only by Order of the Court"; and (iii) that this Order take effect in the Commonwealth of Australia, (2) Order pursuant to s 511 of the Corporations Act 2001 (Cth) (the Act) that Geoffrey Trent Hancock be appointed as an additional liquidator (the Special Purpose Liquidator) to the first defendant (Company) for the following purposes: (a) Conducting investigations in relation to any of the matters set out in the affidavit of Geoffrey Newling sworn 24 February 2017 (the Newling affidavit) including, if thought by him to be appropriate, by: (i) inspecting the books and records of the Company, excluding any files and working papers of the second defendant; (ii) conducting examinations pursuant to ss 596A and 596B of the Act or obtaining orders for production pursuant to s 597(9) of the Act; and (iii) requiring statements to be provided pursuant to s 475(2) of the Act; (b) commencing and pursuing any claim, including by commencing legal proceedings, that may be available to the Company or the Special Purpose Liquidator in relation to any of the matters set out in the Newling affidavit, including obtaining and considering legal advice in respect of any such claim; (c) taking any steps as Special Purpose Liquidator in relation to any of the matters set out in the Newling affidavit, including by commencing legal proceedings to preserve or protect the assets of the Company, or the assets to which the Company or the Special Purpose Liquidator claim to be entitled, and whether or not those assets are in the possession of the Company; and (d) exercising any powers conferred on the liquidator by ss 477 and 506(1)(b) of the Act, including the power to seek relief under s 588FF of the Act, for the purposes set out in (i) to (iii) above, except for the powers contained in ss 477(1)(a)–(c) and 477(2)(f) and (g). (3) Order the Special Purpose Liquidator to report to creditors of the Company and to the liquidator, Mr Cummins, in accordance with the requirements of the Act, on the terms of his appointment and subsequently once every three months during the course of his appointment; (4) Order the second defendant (Mr Cummins): (a) refrain from exercising any of the powers given to the Special Purpose Liquidator in Order 2 above, except with the prior written consent of the Special Purpose Liquidator (such consent not to be unreasonably withheld) or by leave of the Court; and (b) use reasonable endeavours to assist the Special Purpose Liquidator to exercise the powers given to him on Order 2 above, including by providing any documents or information previously prepared or obtained by or for him in investigating or pursuing any claim in relation to any of the matters set out in the Newling affidavit; (5) Order under s 477(2B) of the Act that approval be given for Mr Hancock, in his capacity as Special Purpose Liquidator of the Company, entering into: (a) a funding deed in or substantially to the effect of the deed that is annexure "A" to the affidavit of Geoffrey Trent Hancock sworn 24 March 2017, including the amendment to the definition of "Trust Account" in the form contained in Exhibit 2; and (b) a costs agreement in substantially the same form as the document in annexure "B" to that affidavit. (6) Note the undertaking given to the Court by Mr Hancock that he will not look to or assert any entitlement to resort to funds or property of the Company, or to recover his fees and expenses in respect of his appointment from the Company, other than: (a) in accordance with the terms of the funding deed; or (b) out of the assets or benefits recovered by him during the course of his appointment as a Special Purpose Liquidator of the Company, and in each case in accordance with s 473 of the Act. Catchwords: CORPORATIONS – external administration – application for appointment of an additional liquidator for a special purpose – where contributory of the company seeks the appointment of additional liquidator to investigate potentially voidable transactions between company in liquidation and its sole shareholder and director and another company under his control – where current liquidator is unfunded and not intending to take any further action in investigating the transactions – whether appropriate to make order appointing additional liquidator.